Transport (Re-organisation of Córas Iompair Éireann) Bill, 1986 [Seanad]: Committee Stage (Resumed).

SECTION 7.
Debate resumed on amendment No. 5:
In page 5, subsection (10), line 23, after "winding up", to insert the following:
"and unless the Minister and the Board have had consultations with the recognised trade unions".
—(Proinsias De Rossa.)

The Minister for Communications is in possession.

I was about to respond to the Minister's remarks about my amendment No. 5 to section 7.

Is the Minister giving way to Deputy De Rossa?

The purpose of the amendment is to ensure that where any of the companies proposed under this new Bill are about to be wound up which under the section will require resolutions of this House to do so, there will be a mandatory requirement on the company to consult also with the recognised trade unions in the company affected. In responding to that amendment the Minister seemed to misunderstand the purpose of the amendment. It is a requirement to consult with the recognised trade unions. The Minister in response suggested that this would in some way affect the flexibility of the company in responding to market conditions and so forth.

I put it to the Minister that if a company is about to be wound up the question of them responding to market conditions or otherwise is no longer an issue. What is at issue is the reasons for the wind up, the question as to whether the staff involved are adequately briefed about what is happening, the reasons for it to have happened and that there is full agreement from the staff about the course of action which it is proposed to take. That is the purpose of the amendment and it is not intended to in any way shackle the company in their day to day activities. If the winding up of a company is important enough to have it brought before this House, it is equally important that the staff employed by the company should be consulted about the proposed move.

Is amendment No. 5 being pressed?

Amendment put and declared lost.
Question proposed: "That section 7 stand part of the Bill".

As the naming of the companies comes up under this section, I may be putting down suggestions on Report Stage as to a proper name or names for the companies, and the Minister was amenable to some suggestions with regard to the naming of the companies. Specifically, my intent would be to have Irish language names exclusively on the companies.

Question put and agreed to.
SECTION 8.
Amendments Nos. 6 to 8, inclusive, not moved.

Amendment No. 6 fell with amendment No. 3. Amendment No. 7 in the name of Deputy Wilson and amendment No. 8 also fell with amendment No. 3. We will deal now with amendment No. 9.

This really falls with the other amendments.

It was not discussed with the other amendment.

No, but it does not make sense any more.

This proposal I agree is entangled with the other proposals. I will comment on this although I accept, as the Minister says, that this is linked in with the other amendments.

I move amendment No. 9:

In page 6, lines 12 to 16, to delete subsection (9).

Section 8 relates to competition between services of the companies and provides that the companies shall have regard to the overall interest of the board and in any conflict between the companies the board shall decide the issue with due regard to its overall interest and the interest of the particular companies concerned. This section is obviously the result of unease with regard to competition as between the various companies and specifically between the national bus company and the national rail company. The very fact that it is in here is an admission that this may be an area of difficulty. The Minister said that he wants an element of competition but that that would be moderated and monitored by the board. I presume that the amendments accepted about the participation of directors across the company, the mutual sharing of directors, was also an attempt to meet the case that there could be competition which would not be to the advantage of either one or other company or the board of CIE. The reason I asked for the deletion, although I can see why the Chair ruled that it would not be taken with the other amendments, was in the context of having suggested that there would be one company covering national rail and bus. If there were one company then this element of competition would not occur. I still think that the original suggestion was a sound one and that asking for this deletion was logical in the context of that sound proposal.

Is the amendment withdrawn?

There is not much point, when we have been defeated on the other two, in dividing the House on that one now.

Amendment, by leave, withdrawn.
Question proposed: "That section 8 stand part of the Bill."

Section 8 (1) reads:

8.—(1) The principal object of Iarnróad Éireann-Irish Rail shall be stated in its memorandum of association to be to provide, within the State and between the State and places outside the State, a railway service and a road freight service and for those purposes to exercise functions in that behalf conferred on the Board by the Act of 1950 or any other enactment.

On Second Stage we referred to the position with regard to freight and the Minister assured us, although some experts in that field whom I have consulted since are not inclined to accept it, that the freight services had been justified by making a profit. I presume that the principal object of the railways company would be also to provide extra rail services if it were so decided and we would not exclude development of the rail service. Yesterday's post brought to me an account of the new rail service to a very run down and dilapidated part of the London harbour and port area, the Isle of Dogs and the area around there, where they are going to run a new train service which will not have any drivers. There may be one conductor on the train, but it will be a totally automated service. While they know that at the moment there is not a very heavy population in the area they have a feeling that the availability of this service will increase the population of that area. Just as is happening with the DART where house values have risen because of the existence of this service close at hand. I presume that the articles of association will be so framed that the railway people will be empowered to think of such developments.

I read from one of the trade union documents an indication that the Minister had said that he had intended to develop a rail service to Tallaght and other places, but this was by way of a preelection policy document and for some reason or another we have not seen anything on the ground since then with regard to it. The Minister may have changed his mind on that. Section 8 (2) says:

(2) The principal object of Bus Éireann-Irish Bus shall be stated in its memorandum of association to be to provide,

I do not like the English language there. It is not a solecism but it is a very awkward phrase. The subsection goes on:

within the State and between the State and places outside the State, a passenger service by road, except in so far as such a service is provided by Bus Átha Cliath-Dublin Bus, and to provide ancillary services and for those purposes to exercise functions in that behalf conferred on the Board by the Act of 1950 or any other enactment.

The memorandum of association should keep a developmental role in mind. We have been conditioned for practical reasons to think of restricting services, of cutting down rather than developing. I would urge the Minister in his communications with the companies to keep that in mind. The Dublin bus company could be made into a commercially viable profitable service and this will demand a parting of the ways with rigid thinking and the idea that double deckers should be on various routes at all times of the day. Flexibility in planning and in the use of vehicles should be taken into account. I mentioned places in Europe where a mini bus service is made available in off-peak hours or between awkward points which are not on direct routes. The present bus services are on the same routes as the Dublin train routes with extensions demanded by the expansion of the city boundaries. If the Dublin city services were properly organised with a good traffic management system, in conjunction with the Dublin Transport Authority and further areas pedestrianised, we should and could have a profitable company which would do a lot for CIE's prestige.

Subsection (4) states:

There may be included among the objects of each company such other functions of the Board as may be approved by the Board with the consent of the Minister and the Minister for Finance.

Subsection (5) states:

Nothing in this section shall prevent or restrict the inclusion among the objects of a company as stated in its memorandum of association of all such objects and powers as are proper for or incidental or ancillary to the due attainment of the objects aforesaid.

Subsection (6) states:

Each of the companies shall have power to do anything which appears to it to be requisite, advantageous or incidental to or which appears to it to facilitate the achievement by it or any of its objects as specified in this Act or in its memorandum of association and is not inconsistent with any enactment for the time being in force.

Subsection (7) states:

Where any function of the Board is, by virtue of this Act, a function of a company every provision of any enactment relating to the Board shall, in respect of that function and subject to the provisions of this Act, apply to the company as it applies to the Board.

That is a logical subsection to give powers to the new companies in relation to the board.

Subsection (8) states:

Each company shall undertake the functions assigned to it by virtue of this Act in compliance with such directions as the Board may give to the company in writing from time to time.

I have already commented on subsection (9).

Subsection (10) states:

The Board and the companies shall have due regard to the Board's social role and the need to maintain public transport services integrated to the maximum extent possible within the financial resources available to them.

The amendments which this side of the House and Deputy De Rossa put down in regard to subsection (10) would guarantee the integration to a much greater extent than will three separate companies, specifically two separate companies for rail and bus services. This House is particularly interested in the board's social role because in 1985, as has been repeated over and over again, it voted £115 million to CIE and that was categorised as the social price we pay for services throughout the country. It was a substantial sum and when we are taking the amendment dealing with transparency I should like the House to have the maximum amount of knowledge in regard to where this subsidy goes.

Nothing in the Bill will preclude the possibility of future extensions of the railways. The extension of DART is a priority for consideration by the newly formed Dublin Transport Authority and I expect they will make recommendations to me within the next year. This section provides that the principal object of the railway company should be to run a rail service and that the principal object of the city bus services is to run a service for the city. However, it allows other objects to be added because I am very keen to exploit the fantastic human and property assets of the company to enable them to participate in other business opportunities so that there might be profits to offset the calls of the Exchequer as was successfully executed by other State companies like Aer Lingus.

Question put and agreed to.
SECTION 9.
Amendments Nos. 10 and 11 not moved.
Question proposed: "That section 9 stand part of the Bill."

As the Chair rightly said, these amendments fell as a result of the vote before lunch. I suppose I should not speak on the section because of the vote was lost although I find it very hard to understand why the Labour Party did not support it. I thought on account of the strong proposals made in support of the two company solution from the Irish Congress of Trade Unions and other individual unions involved in the running of CIE, that this would have commanded support. I am not speaking in a political sense but it is hard to understand why we could not agree on the two company solution. It may very well be that in the future we may have to revert to that position by way of amendment to the Act. I do not know what the result of separating the three companies will be but if the problems I mentioned arise and if they prove too much for the parent board the House eventually may have to adopt it as a solution to the problem.

Question put and agreed to.
SECTION 10.
Question proposed: "That Section 10 stand part of the Bill."

This is a routine section regarding the memorandum of association of each of the companies.

I suppose this is a safeguard section. I would have thought that the memorandum of association and its details were sufficiently spelt out in the Act without having to insert this section. Its only purpose must be to insist on the approval by the board and the trinity of Ministers, the Minister for Communications, the Minister for Finance and the Minister for the Public Service. In some of the other Bills which came before the House in the recent past there was a bigger pitch by the Minister for the Public Service to get his claws on various powers with regard to remuneration. I do not think that this section is making that kind of pitch.

If Deputy Wilson is Minister for the Public Service in the next administration I will be saying the opposite of what he is saying.

It will not be my first choice I can tell the Deputy. I do not think I could be entrusted with it because my heart is——

—— too soft for that kind of job.

Question put and agreed to.
SECTION 11.

I move amendment No. 12:

In page 7, lines 16 and 17, to delete subsection (4).

I would like to explain that this amendment was put down in the context of my earlier amendments for two companies. The logical step was then to delete subsection (4). Having said that it was a clever amendment which was accepted by the Seanad. It linked in with the problems we have mentioned already while talking on section 8 (9), the problems of coordinating and integrating services for the rail and bus. I would like to commend the Minister and/or his advisers, the Fianna Fáil Party in the Seanad, the Labour Party in the Seanad, the trade union representatives or whoever thought this one up to improve the Bill in the context of three companies. If we could not have two companies then the idea that the majority of directors of the railway company and the Irish bus company shall be common to both companies does go a good bit of the way to solving it.

From reading the debate in the Seanad I know that certain people thought there could be trouble about a majority because the number of directors is small. There are worker directors. This can cause a certain amount of trouble with regard to coming to decisions later on. I am sure that danger is there. It is my hope now, having lost the game so to speak in the two votes we have had, that there would not be a paralysis in making decisions or in deciding on policies. There will be a majority of the directors in the railway company and in the Irish bus company who will share this majority of directors, so at least, there is a forum below the parent board in which certain problems can be thrashed out. Admittedly, the board will finally have to decide on what policies are to be pursued or what piece of property will be allocated to which company and so on. It means, of course, that if they cannot come to a decision it will be referred back to the board when this load will be put on them. I do not think that this load should be on the board. The more problems which are solved at that level the better for the future running of the company.

Is the Deputy pressing his amendment?

I got two bloody noses already. I have no appetite for another one on this amendment. That is not to say I will not be calling a division later on.

Amendment, by leave, withdrawn.
Section 11 agreed to.
SECTION 12.
Question proposed: "That section 12 stand part of the Bill."

Section 132 states:

Notwithstanding anything contained in the Companies Acts, no alteration in the memorandum, of association or articles of association of a company shall be valid or effectual unless made with the prior approval of the Minister given with the consent of the Minister for Finance and, where appropriate, the consent of the Minister for the Public Service.

It is in that context that we have been talking. Obviously, the Companies Acts would normally empower an alteration in the memorandum of association in the case of an ordinary company. This is a caveat section to give the Minister the power, in collusion with the Minister for Finance and at times with the Minister for the Public Service, to see to it that the companies do not go haywire in any particular way. I am always suspicious of people who prepare the heads of the Bills and those in Government who finally decide on sections such as this, because the purpose is to make it more cosy for the Minister and for administration. I suppose it is a necessary safeguard. If we take it that the people who will be appointed to the boards are committed to the development of the company and to the provision of the type of service the company are supposed to give, we could take it for granted they will not go haywire and alter the memorandum of association or the articles of association in such a way as would damage the company or the country.

I have no further comment to make except that we are inclined to be cautious. People who are involved in legislation will always tell you that you cannot be too cautious because if any loopholes are left they will be taken advantage of eventually. I will continue to look with scepticism at everything which arrogates extra power to the Administration or to a Minister.

Question put and agreed to.
SECTION 13.
Question proposed: "That section 13 stand part of the Bill".

This section is an improvement on the position we used to have and about which I used to be a little sensitive. Section 13 subsection (1) states:

Where a director of a company is—

(a) nominated as a member of Seanad Éireann, or

(b) elected as a member of either House of the Oireachtas or of the Assembly of the European Communities, or

(c) regarded pursuant to section 15 (inserted by the European Assembly Elections Act, 1984) of the European Assembly Elections Act, 1977, as having being elected to such an Assembly to fill a vacancy,

he shall thereupon cease to be a director of the company.

On balance over the years, I have changed my views. I have spoken in this House on occasion against this whole trend on the basis that it was giving some kind of credence to people who thought actual participation in politics and membership of this House in some way impaired their judgment, their impartiality or their capability of making a contribution to a particular company. I would like to repudiate that kind of suggestion, and the suggestion is there.

Over the years I have come to the conclusion that it is probably better if Members are excluded, but there is a distinction here between a director and an employee. Before I deal with that, I want to look as section 13 (1) (a) which says "nominated as a member of Seanad Éireann". In my opinion, a nomination is not enough to preclude a person from directorship.

A person nominated by the Taoiseach to be a Member——

That does not affect the original nomination, although I know it did in other legislation.

Is the Minister sure that it is just as a member——

This provides where the Taoiseach nominates——

In other words, it only covers one of the eleven.

Section 13 (1) (b) reads:

elected as a member of either House of the Oireachtas or of the Assembly of the European Communities,

I suppose I must leave it at that, but I want to underline what I have said already about this type of thing. The fact that the person participates, or gets elected to Seanad Éireann, to Dáil Éireann or to the European Assembly, in my opinion should not be taken as impairing him in such a way. I have an idea that at one time even nomination to contest Seanad elections precluded a person from membership of certain boards and committees. I shall maintain opposition to that.

As everybody knows, there are a series of nominating bodies. If the royal association of organ-grinders nominate somebody he has not a hope of being elected to the Seanad, but some legislation precludes him. The distinction here between director and employee is valid. I am glad to see the Minister has made provision for secondment. Is that right?

I wonder if that is a new development in legislation or if it has been in existence for some time? However, I welcome it because it is a good idea and secondment gets over what is in my opinion, an injustice. Section 13 (3) reads:

A person who is for the time being entitled under the Standing Orders of either House of the Oireachtas to sit therein or who is a member of the Assembly of the European Communities shall, while he is so entitled or is such a member, be disqualified from becoming a director of or from employment in any capacity by a company.

We have debated that. No comment.

This is a routine provision in all legislation providing for the relationship in the case of State companies of people who are elected or nominated to be in the Seanad, or elected to Dáil Éireann or to the European Assembly. This is a routine provision and it provides for secondment.

Question put and agreed to.
SECTION 14.
Question proposed: "That section 14 stand part of the Bill".

This is an important section. The intent of this section is to give all the necessary guarantees and assurances to the staff about their position in the future, that is, the staff who are at present employees of the board who will be transfered to any one of the companies. It also requires each of the companies to set up the necessary industrial relations machinery for consultation with the registered trade unions. It also provides that where any of the companies is wound up, the employees transferred on vesting day would be transferred back automatically to the employment of the board as if their employment had not been interrupted and the responsibility for the services provided by the wound-up company reverts back to the board. It also provides that the employees, for the purposes of the Worker Participation (State Enterprises) Act, 1977, shall be deemed to be employees of the entire group of companies. This underlines the unity of the group of companies and the very firm intention that they remain so.

Many of these provisions are routine for State companies and in large measure are based on the Postal and Telecommunications Services Act introduced by Deputy Wilson. Some of the provisions in the section were proposed in the Seanad on Committee Stage following a very useful discussion. I believe all the employees of the companies will be very gratified by the provisions in this section.

I agree that this is a very important part of the Bill. The provisions are designed to put at ease the present employees of CIE. There are some points I would like the Minister to comment on. I would like him to comment on the powers of allocation to specific companies; in other words, that each employee of the present CIE will be retained as an employee of one of the companies as and from the vesting day. What procedure will be adopted by the board? Will they select the individual workers for individual companies? The words "officer or servant" are used but objection was taken to them in this House already. "Employees" would cover both areas and I suppose it is out of deference to terms that have been used in legislation for some time that they are used here. What is the position of those people in CIE at the moment who are designated to work in one of the three companies — and it seems from the voting that there will be three companies — but who do not want to go there? How is the problem resolved? Is there specific machinery under the Bill to try to resolve that difficulty?

When the reorganisation scheme was announced originally the point was made that there would be 500 to 600 redundancies. Since then, I think the Minister — and the chairman and chief executive officer of CIE in conversation with me — indicated that most of those redundancies had occurred already. I would like the Minister to tell me how many people are affected. Is there any special machinery or will the general redundancy machinery be operated in this case?

I want to make another point on the section with regard to conditions. Subsection (5) reads:

Save in accordance with a collective agreement negotiated with any recognised trade union concerned, every person who, immediately before the vesting day, is an officer or servant of the Board shall not, while in the service of the Board or a company, as the case may be, receive a lesser scale of pay or be brought to less beneficial conditions of service than the scale of pay to which he was entitled and the conditions of service to which he was subject immediately before the vesting day.

On Second Stage I indicated that there were some things happening which would indicate to me that some persons who immediately before the vesting day are officers or servants of the board will be brought to less than official conditions as a result. I gather that the chief civil engineer's staff were being summarily transferred from Pearse Street to the former British Railways offices on the North Wall. Perhaps the Minister would comment on whether this has come to his notice. This would seem to me to be in conflict with the terms of section 14 and its relevant subsections. The main points made — and they are valid ones as far as I can see — are first, that staff located at Pearse Street would have the services of the DART line at their disposal to take them to and from work. I do not have to emphasise to the House that that is a very strong and specific advantage, a very beneficial condition of service. If the words in section 14 mean what they purport to mean, or what is their normal meaning, then that should not happen. It was announced that there would be specific discussions with the trade unions with regard to problems such as this. The people involved in this case are not unreasonable. In fact they state that they fully appreciate the difficulty of doing this job of reorganisation within CIE and are ready, able and willing to co-operate in the plan and to be as helpful as possible. I gather that this transfer would involve considerable capital expenditure. Therefore, before that expenditure is incurred the problem should be resolved.

I mentioned specifically the advantage of having the DART service right to the office door, so to speak, at Pearse Street, which is a very considerable advantage. Apparently the services to the North Wall are very poor indeed, there is one bus, the 53A, that serves the area. This is something that should be taken into consideration when relocating a considerable number of staff. The former British Railways offices are the best part of a mile or more from O'Connell Bridge. Another point about which staff are concerned is safety and security in going to and from their work in that area. There have been instances of mugging in the area. I do not want to exaggerate. In fact I know the area; I know both the North and South Quays. It is easy to get an exaggerated sense of danger but there have been some incidents in the area which have caused concern to the staff. In general the staff of the chief civil engineers' office feel the new area would not have the same amenity value as the area in which they are at present located. I do not want to labour that point. Perhaps the Minister would let me know whether he knows anything about it, whether the problem may have been solved since then, whether the large capital expenditure has already been decided or whether anything is under way in that area.

The answer to the Deputy's question is that I do not know very much more about the issue than what he said in the House or what I have read in the newspapers. I think there was a little about it in the newspapers. I would very much desire that the reorganisation be implemented by the board with the greatest sensitivity. I am satisfied that that is the way the board are approaching it. Obviously there will be a number of thorny problems to be resolved. I would hope they could be resolved with maximum agreement and consultation. However, I should point out that these arrangements of locations within a company like CIE do not just take place at a time of reorganisation like this but all the time when new offices or workshops are being provided and so on. It is desirable that there be the maximum amount of flexibility among the staff concerned. I will convey to the chairman of the company the points raised specifically by Deputy Wilson and I hope they can be resolved. It would be wrong for me, as Minister, to become involved in the detail of who goes where, who does what, or to be a referee. Nonetheless I will pass on Deputy Wilson's concerns in the matter.

Thank you.

This is a valuable section, greatly improved by the Seanad. It will afford great reassurance and security to those now employed in CIE.

Subsection (7) reads:

If any of the companies is wound up, the functions of the company shall be exercised by the Board, and the Board shall accept into its employment without interruption of service all officers and servants employed by the company in consequence of subsection (4). Such officers and servants shall resume their employment with the Board on the same conditions of service as applied before the vesting day unless otherwise provided for in a collective agreement negotiated with any recognised trade union concerned.

There is much debate at present about companies going into liquidation and starting up business again under another name. Some people might think that this smells of the same thing. I am sure the Minister would like to reassure the House that it does not.

It absolutely does not. It is there to reassure employees that if any such thing did happen, not only will their employment be guaranteed without interruption but that their service will continue without interruption. It was the only way we could find around the normal bankruptcy law without completely subverting bankruptcy and company law and yet have a company format for this reorganisation.

I can see the logic of subsection (8). The worker-directors on the board at present will hold office until when — just as a matter of interest — because it is relevant with regard to the vesting day?

Recently there have been worker-director elections.

1986, is it?

Yes, within the last couple of months. The new worker-directors' term of office commenced on 1 November. Indeed I signed the letters of appointment only this morning. They will hold office for three years.

To 1989?

Yes. Membership of the main board is not affected in any way by the provisions of this Bill. But the position of members in relation to the subsidiary companies is provided for, whereby at least two worker-directors of the main board must be members of each of the subsidiary boards.

That is two out of a total of six. Do they have to be the same with regard to the national bus company and the national rail company?

No, it does not necessarily follow that they have to be the same. What is provided for elsewhere in the Bill is that a majority, in other words four, of the directors will be common to the national bus company and the national rail company. As it is provided that two worker-directors will be members of the board of the national bus company and the national rail company it is highly likely that they will be the same two people. It is not certain that it will be the same two people but it is highly probable.

Section 14 (8) is tantamount to an amendment of the Worker Participation (State Enterprises) Act, 1977. It provides a definition which is different from the definition that would apply to a worker-director under the Worker Participation (State Enterprises) Act, 1977, in relation to CIE because CIE was only one company at that time.

That is right.

We do not have to say anything about changing any part of the 1977 Act. This modifies the procedure in relation to——

It merely clarifies, in case there is any doubt, that the constituency for the election of members to the CIE board will be all the employees of the CIE group of companies, including the board and the companies hereby set up.

On Second Stage I raised the question of recruitment of employees to CIE. In the clerical area there had been a system of a national open competitive examination. I gather that method has been dispensed with. It was one which commanded the confidence of our young people and one I would like to see adhered to. We could bring into operation methodologies for testing which have been developed as well as the written examination. The reason I am raising it on this section is because the existing personnel of CIE will now be allocated to three different companies and also to the parent board. There will be four different units and they will all, for the purpose of electing worker directors, be regarded as the same constituency. When the companies are set up, will each company recruit its own staff? For example, will the Dublin city services company recruit its own staff or will the parent board recruit for all the three subsidiary companies? This definition will cover the position with regard to the worker-directors. I would like to know the Minister's view on recruitment generally, on methods of recruitment, whether the individual companies will do the recruitment or whether the board will recruit for itself and the other three companies.

Each company will recruit for itself. In relation to the changing methods of recruitment, this has been requested by the board and the trade unions. Under the present law CIE are required to have open competitions for clerical appointments which, when there are only one or two vacancies, is very expensive as there might be thousands of applications. Over a number of years they have taken on temporary people and that has been very unsatisfactory for the people themselves and for the company. Because of the small number of vacancies that are likely to arise in the future it is not very sensible to require the companies to have open competitions. They should be able to recruit in the normal way.

I accept what the Minister has said. The Committee on Public Expenditure made a very thorough investigation of this problem. We learned that large sums of money were being spent and the candidates were being fooled as large numbers were examined and very few were appointed due to the restriction on recruitment. I am a little dubious about leaving the recruitment to the companies. It will be stated, often without very much substance, that the recruitment to the companies is not carried out on a very fair basis. I do not know how to get over that difficulty. I agree with the Minister that holding a nationwide examination with thousands of applicants and maybe only ten vacancies is ridiculous and a waste of public money. Some system should be evolved to get over this problem of employing people in a temporary capacity without there being specific criteria for such employment. Can I ask the Minister if that rule still holds as the CIE board will not be affected by this new legislation? It will still exist as the board of CIE. Will the law still obtain with regard to that despite the setting up of the new companies?

The board and the companies will have the freedom to recruit. The section providing for open competitions has been revoked.

Where has it been revoked?

In section 5. It states, "Section 14 of the Act of 1950 and section 35 (2) (inserted by section 12 of the Transport Act, 1964) of that Act are hereby repealed".

I had intended raising that matter and I am glad I had the opportunity to do so under this section. We might get back to that discussion some other time.

Question put and agreed to.
SECTION 15.
Question proposed: "That section 15 stand part of the Bill".

This is a routine section which provides that the pension scheme of the board is available to the members of all the companies.

Question put and agreed to.
SECTION 16.
Question proposed: "That section 16 stand part of the Bill".

This section states that the board may be licence from time to time authorise the use by any of the companies of any land held by the board on such terms as the board may prescribe. By licence does it mean a decision by the board conveyed in writing to the company or is there a more formal legal document involved? Section 16 (2) states:

The Board may make to a company a lease or assignment of any premises of the Board to which a licence under the Licensing Acts or the Refreshment Houses (Ireland) Act, 1960, is attached.

Subsection (2) is ambiguous and I should like the Minister to verify that a "company" means a company of the group of companies known as CIE. There is no specific indication in subsection (2) that the "company" is not an outside concern. It may be that the Minister intends that it should be an outside company. Does the Minister mean that the board may lease to an outside company or make an assignment of any premises to an outside company?

According to the definition a "company" means a company set up under the Bill. In other words, one of the three companies set up by the Bill.

What will be the position in regard to the leasing of CIE property? The company have a lot of property up and down the country and I should like to know if the subsidiaries will be permitted to lease or rent it. In Wexford town CIE own the old railway station which is no longer in use but they have refused to lease or rent it to local organisations. Will such property come under this provision?

CIE have the authority to dispose of property as they see fit.

They have refused to lease or rent the property in Wexford.

Presumably they did so for their own good reasons. The company can sell, lease or rent property and that will not change under the Bill. We are providing that where land is for one reason or another not transferred to one of the companies but is held by the board, the board may give the use of that property to one of the companies by way of licence.

I cannot allow the opportunity to pass without indicating to the Minister that some of the property belonging to CIE in Cavan town could not be leased to anybody except, perhaps, as a location for a Sam Beckett play. Will the Minister remedy that as soon as he can?

The position is the same in Wexford town.

I will make a commitment that when the Bill is passed I will ask the board, as testimony to Deputy Wilson's co-operation, to do something about the property in Cavan.

Having heard that I will positively try to speed up the debate on the Bill.

Question put and agreed to.
SECTION 17.
Question proposed: "That section 17 stand part of the Bill".

This routine section provides that property in use by the relevant sections of the company should on vesting day be transferred to those sections except where the board otherwise decides.

Subsection (1) states:

(1) On the vesting day all property other than land, including choses-inaction, which immediately before that day was the property of the Board and was used in connection with a function conferred on a company by virtue of this Act shall stand vested in that company without any assignment, unless, in respect of specified property, the Board otherwise decides.

Does that mean that if a provincial bus company had been using that property without any specific assignment by the parent board it will have the use of that without any further ado? Is that the specific meaning of the section?

It will not be necessary to have any formal assignment by the board?

If the board want to exclude a transfer they have to specifically say so. This will save a lot of legal documentation.

In the case of an office premises or building used by the bus and rail sections will the board have to make a specific legal assignment to one or the other?

Yes, or hold on to it themselves or issue a licence under the preceding section.

If the board hold on to such property it may eliminate difficulties if there is a clash. Subsections (2) and 3 state:

(2) The Board may on its own initiative and shall on the application of a company issue a certificate in respect of specified property, certifying, as it thinks proper, that the property vested in a particular company under this section or did not so vest in any of the companies and the certificate shall be conclusive evidence of the facts so certified.

(3) Every chose-in-action transferred by subsection (1) to a company may, after the vesting day, be sued on and recovered or enforced by the company in its own name and it shall not be necessary for the company or the Board to give notice to the person bound by the chose-in-action of the transfer effected by that subsection.

I do not have anything further to add.

Question put and agreed to.
SECTION 18.
Question proposed: "That section 18 stand part of the Bill".

This routine section provides for the transfer of all rights and liabilities of the board to the individual companies as is appropriate.

With regard to liabilities I presume that the Minister, and the House, are aware of ordinary citizens who have had occasion to sue CIE for injuries and so on have found it the most difficult company from which to get legal redress for injuries. I have had some experience of this and I know of cases that have gone on for a long time. One can see CIE, acting in the public good, feeling obliged to fight everything to the bitter end and paying out as little as possible. In doing that they are looking after the interests of the company and the Exchequer that subsidises it heavily but I am aware of cases where the company's legal representatives have thrown every obstacle in the way of people who got awards in court. The process was held up by way of appeals and not putting in documents in time for the appeals. Perhaps now that there is a new structure pending there will be an improvement. If I have a car accident involving a bus the property of the new bus company, will the parent board have legal responsibility or will it be a matter for the provincial bus company?

The company.

I hope the company, being smaller and, according to the Minister's thesis, being more in touch, will be able to speed up even the slow processes of the law.

I have no doubt about that.

I should like to question the Minister about injury to stock. When cattle or sheep are injured or killed on the railway line I have the same problem as that quoted by Deputy Wilson. It appears that there is not a human face in CIE to deal with such matters and farmers have great difficulty in getting compensation. Will liability for injury to stock on the railway line come under this section?

Yes, but instead of the matter being dealt with by the board it will be dealt with by the railway company.

Question put and agreed to.
SECTION 19.

I move amendment No. 13:

In page 10, subparagraph (5), lines 11 and 12, to delete "such period after the end of each accounting year as the Minister may direct" and substitute "three months after the end of each accounting year".

We anticipated some of the argument in favour of this amendment earlier in the debate. If we go back to the original transport reports, particularly McKinsey, and the contributions of various Ministers in the House, including Deputy Bruton, we will find that there has been an anxiety to know exactly how the revenue raising services of CIE have been developed, and, of course, the need for subsidisation. The Chair will appreciate something I said on the occasion of an Estimate debate, that very often the railway company had to relate to losses which did not belong properly to them on the basis that the House would not interfere with the railway service.

The prime objective of the amendment is to make available to the House in good time an account of the financial activities of the company for the year. As Deputy Ahern has said, times have changed greatly in recent years with regard to information technology. It is the "in" thing to talk about it, and people involved in this technological revolution refer to "transparency". Perhaps I am being over generous in giving CIE a full three months after the end of the year to complete their audit. If the new companies are to have the effect the Minister wants, namely, that as smaller entities they will be nearer to the action, including industrial relations, etc., they will be able to put the accounts together more quickly. It should be possible to do this within three months after the end of the financial year which in the case of CIE is 31 December. That means the amendment is allowing January, February and March for the putting together of the accounts, and that is long enough for the House and the taxpayers to have to wait.

In one of the Oireachtas committees we discussed this matter and there have been submissions from various State-sponsored bodies about difficulties. An experienced man from the accountancy profession indicated that in the US there is a big drive to have audited accounts ready at a certain time of the year and that the accountants at that time are working around the clock. Many companies here end their year on 31 March, CIE's is 31 December, so that the year is staggered already.

I should think that the Minister in his heart agrees that the annual figures should be available not later than three months after the end of the financial year in CIE. In his speech he indicated he has developed reporting procedures to provide "transparency" so that we will be able to see what is happening in a reasonable time. I was surprised earlier when the Minister suggested that this could lead to an outbreak of political chicanery. He thought it might mean, for instance that some person would say that the line to Westport was losing money and that somebody who did not like it would seek to have it closed down.

Or the subsidy increased and the fares reduced.

One would not need to have transparency to provoke suggestions that the fares should be reduced — that suggestion will be there anyway. According to accepted philosophy, there is a strong social element in the activities of CIE — if that is not accepted by all of us here it is accepted by the vast majority of Deputies from all parties. Therefore, transparency, or quick knowledge in the most detailed manner, will be necessary and it is for that purpose that I move the amendment. Deputy Ahern is an accountant and he will have some remarks to make on the amendment, which I feel very strongly about and urge the Minister to accept.

I join Deputy Wilson in support of the amendment. It would be better if this were written into the Bill so that in future some other Minister might not insist on it. Nowadays, with the change in auditing procedures and the availability of sophisticated computer systems to produce information it should be quite easy to have an audit completed within three months of the end of the year. It is not a major problem for an organisation like CIE, considering the firm doing the company's audit.

As I have said, there has been a change in auditing. There is continous auditing throughout the year nowadays so that at the end of the year there is not the same amount of work necessary. Under the new regime it should be quite easy to have the figures available three months after the end of the year. It is particularly desirable in a company such as CIE in which so much public money is invested. Deputy Wilson expressed clearly the necessity for bringing out information at an early date and detailed information is most important particularly for companies such as CIE where a lot of public money is utilised. On those grounds I urge the Minister to accept Deputy Wilson's amendment specifying three months as the maximum period within which the accounts should be published.

I am in sympathy with the intention of this amendment so I regret all the more that I am unable to accept it. I accept that there has been a problem in getting out the report and accounts not only of CIE but of many other companies in the past. However the House will be interested to learn the progress achieved by CIE in accelerating the submission of their accounts in recent years. The accounts for 1982 were presented to the Dáil and Seanad on 29 February 1984; those for 1983 were presented on 14 December 1984; those for 1984 were presented on 1 October 1985 and those for 1985 on 16 September 1986. Each of these represents an improvement on the preceding year.

There is however scope for earlier presentation and CIE are working in that direction. It is my intention to invoke the powers in the subsection at the appropriate time to specify a deadline. I would think that three months is too short. I would be inclined to say it should be more like four months. But to start off with I have in mind a six month deadline and my aspiration would be to get to a four month deadline. Three months would be difficult because of all the work that has to be done, and very few private companies achieve a deadline like that.

If we were to write the deadline into the Bill we could have all sorts of problems, for example, if there was a strike in the printers or the auditors could not complete the work by the deadline. In such cases we would be in conflict with the legislation. The Minister should have the power, in exceptional circumstances, to alter the deadline. I intend to implement the principle behind the amendment to get to a stage, within a reasonable number of years, where CIE would be presenting their report and accounts to the Dáil within four months.

I want to urge this amendment very strongly. The Minister has really proved my point. He has indicated that there has been an improvement and that improvement is welcome. How bad it was is indicated by the fact that the 1982 accounts appeared in 1984; the 1984 accounts appeared in 1985 and the 1985 accounts appeared in September 1986. That is far too late for this House to assess and make decisions with regard to the payment of money. Admittedly this House would be bringing in a budget in January for, for example, 1987 and in the Vote for the Department of Communications there would be subheads covering the subsidy for CIE. Even if the accounts were published by 31 March information that should really be available in January could not possibly be made available. But March would not be too bad and any modifications of policy or adjustments could be taken in the same year.

I asked questions also about the B & I accounts and no accounts had been published for up to two years. If this House decides to pay money or take up equity in a particular company, it is not good enough that the whole scene is not transparent to them. For that reason I urge the Minister to accept this amendment. I know by his response that he is totally in sympathy with the thinking behind this amendment and that he wants his Department to have up-to-date information on the various semi-State companies under his aegis. Therefore he would be doing a good job for the companies, the legislators and the taxpayers if he accepted this amendment.

I would like to know if the same auditors will audit for the parent board and for the individual companies or if the individual companies will have the power to appoint their own auditors. If they do, and I see no reason why they should not, it would be necessary to co-ordinate them so that the over-view will be available and so that the audit procedures of the different auditors could be properly aligned.

The Minister mentioned earlier on that the reports for 1984 were put before the Dáil in September 1985.

They were put before the Dáil in October 1985.

I notice that the audited reports were signed by the auditors on 13 May 1985 so they were available early in the year.

That is an argument against the amendment, because when the accounts are audited by the auditors they are then submitted to the board for approval; the board submits them to the Minister for his approval and when the Minister is satisfied he then submits the accounts to the Government for approval. All that takes a number of weeks and then the Government brings it before the House. Therefore one of the dangers in specifying too short a time is that it might not be possible to do it in such time. I do want it much shorter than has been the practice up to now. On 29 May the 1985 accounts were submitted by the auditors. They were signed by the chairman on 15 August 1986. They were then approved by the Government and tabled before the House in September.

Basically, it is not the auditors who are holding things up.

There is a procedure after the auditors have signed the accounts.

Perhaps the Minister could concentrate on speeding that procedure. It goes from the chairman to the auditor and then from the chairman to the Department. In this case the Minister has power and I am sure that the accounts could be made available to the Minister at the same time as they are made available to the chairman of the company, and both the officials of the Department and the chairman and his top brass in the company could get down to examining them immediately.

The Minister did not answer my question about his view with regard to the auditors. Does he envisage the board having one firm of auditors and the individual companies having the freedom to employ their own auditors or what?

Does he think that some provision should be made for an overall kind of view when the audited accounts are available from the various companies?

Section 19 (3) deals with this question. It provides that:

The accounts of each company shall in each year be audited by the auditor to be appointed by the company with the approval of the Board, given with the consent of the Minister.

In other words, at the moment the auditors have to be approved by the Minister, that is to say, selected by the board subject to the consent of the Minister. Effectively the companies are going to select their own auditors provided they have board and ministerial approval.

Are the parent board to have their own auditors and the individual companies may or may not take the same auditors?

They may or may not. It is speculating I suppose, but in practice they are likely to have the same auditors.

It might be better from an overall planning point of view and from our point of view if that were so. If it were not so and there were individual separate ones, some steps should be taken to see that there is a co-ordination in presentation at least.

Going back to the points Deputy Wilson and I raised, section 19 (5) provides that:

The Board shall, within such period after the end of each accounting year as the Minister may direct,...

Therefore, the Minister can still insist that he gets the report faster than he has already been getting it. The fact that it does not appear here until October and it is held up along the line still does not stop him from putting a section into the Bill insisting that the work be done more quickly than it is being done at present.

We get a faster report because, as I explained to the House on Second Stage, we get four-weekly reports from the board on their performance against budget under each subheading. For the 13 four-weekly accounting periods — 52 weeks not 48 periods — it gives an aggregate performance for the full year. Within about six weeks before the end of the year we have a clear picture of what has happened. It remains for that to be audited and the board to make their written report to me with the audited accounts. As I have said, it is far too slow and will be speeded up.

Take a chance. Be a devil. Throw a cat among the pigeons.

I would very much like to accept this amendment (a) because I agree with the intent and (b) because Deputy Wilson has been extremely constructive. Unfortunately, I think it would be unwise. However, I assure him that my powers to direct will be used to achieve substantially what he is seeking. I would not seek three months but I would like to seek four months.

Are you pressing amendment No. 13, Deputy?

I am reluctantly compelled to do so.

Question put: "That the words proposed to be deleted stand."
The Committee divided: Tá, 76; Níl, 68.

  • Allen, Bernard.
  • Barnes, Monica.
  • Barrett, Seán.
  • Barry, Myra.
  • Barry, Peter.
  • Burke, Liam.
  • Carey, Donal.
  • Cluskey, Frank.
  • Collins, Edward.
  • Conlon, J.F.
  • Connaughton, Paul.
  • Coogan, Fintan.
  • Cooney, Patrick Mark.
  • Cosgrave, Liam T.
  • Cosgrave, Michael Joe.
  • Coveney, Hugh.
  • Creed, Donal.
  • Crotty, Kieran.
  • D'Arcy, Michael.
  • Deasy, Martin Austin.
  • Desmond, Barry.
  • Desmond, Eileen.
  • Donnellan, John.
  • Dowling, Dick.
  • Doyle, Avril.
  • Doyle, Joe.
  • Dukes, Alan.
  • Durkan, Bernard J.
  • Enright, Thomas W.
  • Farrelly, John V.
  • Fennell, Nuala.
  • FitzGerald, Garret.
  • Flaherty, Mary.
  • Glenn, Alice.
  • Griffin, Brendan.
  • Harte, Patrick D.
  • Hegarty, Paddy.
  • Hussey, Gemma.
  • Kavanagh, Liam.
  • Kelly, John.
  • Begley, Michael
  • Bell, Michael.
  • Boland, John.
  • Bruton, John.
  • Bruton, Richard.
  • Kenny, Enda.
  • L'Estrange, Gerry.
  • McCartin, Joe.
  • McGahon, Brendan.
  • McGinley, Dinny.
  • McLoughlin, Frank.
  • Manning, Maurice.
  • Mitchell, Gay.
  • Mitchell, Jim.
  • Molony, David.
  • Moynihan, Michael.
  • Naughten, Liam.
  • Nealon, Ted.
  • Noonan, Michael. (Limerick East)
  • O'Brien, Fergus.
  • O'Brien, Willie.
  • O'Donnell, Tom.
  • O'Leary, Michael.
  • O'Sullivan, Toddy.
  • Owen, Nora.
  • Pattison, Séamus.
  • Prendergast, Frank.
  • Ryan, John.
  • Shatter, Alan.
  • Sheehan, Patrick Joseph.
  • Skelly, Liam.
  • Spring, Dick.
  • Taylor, Mervyn.
  • Taylor-Quinn, Madeline.
  • Timmins, Godfrey.
  • Yates, Ivan.

Níl

  • Ahern, Bertie.
  • Ahern, Michael.
  • Andrews, David.
  • Aylward, Liam.
  • Barrett, Michael.
  • Brady, Gerard.
  • Brady, Vincent.
  • Brennan, Mattie.
  • Brennan, Paudge.
  • Briscoe, Ben.
  • Browne, John.
  • Burke, Raphael P.
  • Byrne, Hugh.
  • Byrne, Seán.
  • Calleary, Seán.
  • Collins, Gerard.
  • Conaghan, Hugh.
  • Connolly, Ger.
  • Cowen, Brian.
  • Daly, Brendan.
  • De Rossa, Proinsias.
  • Doherty, Seán.
  • Fahey, Francis.
  • Fahey, Jackie.
  • Faulkner, Pádraig.
  • Fitzgerald, Gene.
  • Fitzgerald, Liam Joseph.
  • Fitzsimons, Jim.
  • Flynn, Pádraig.
  • Ormonde, Donal.
  • O'Rourke, Mary.
  • Power, Paddy.
  • Reynolds, Albert.
  • Treacy, Noel.
  • Tunney, Jim.
  • Foley, Denis.
  • Gallagher, Denis.
  • Gallagher, Pat Cope.
  • Geoghegan-Quinn, Máire.
  • Hilliard, Colm.
  • Hyland, Liam.
  • Kirk, Séamus.
  • Kitt, Michael.
  • Lemass, Eileen.
  • Lenihan, Brian.
  • Leonard, Jimmy.
  • Leonard, Tom.
  • Leyden, Terry.
  • Lyons, Denis.
  • McCarthy, Seán.
  • McCreevy, Charlie.
  • McEllistrim, Tom.
  • MacSharry, Ray.
  • Morley, P.J.
  • Moynihan, Donal.
  • Nolan, M.J.
  • Noonan, Michael J.
  • (Limerick West)
  • O'Connell, John.
  • O'Dea, William.
  • O'Hanlon, Rory.
  • O'Keeffe, Edmond.
  • O'Kennedy, Michael.
  • O'Leary, John.
  • Wallace, Dan.
  • Walsh, Joe.
  • Walsh, Seán.
  • Wilson, John P.
  • Woods, Michael.
Tellers: Tá, Deputies F. O'Brien and Taylor; Níl, Deputies V. Brady and Browne.
Question declared carried.
Amendment declared lost.

I move amendment No. 14:

In page 10, subsection (7), line 21, after "require" to insert "and, in particular, profit and loss accounts for specific services to and from specific places which services attract Government subsidy".

Amendment No. 14 is in the same context and proceeding from the same philosophy which I share with the Minister with regard to accountability and transparency of all kinds——

(Interruptions.)

On a number of occasions during the debate we referred to profit and loss accounts for specific services to places which attract Government subsidies and, although the Minister did not accept amendment No. 13, nevertheless, I was more than pleased with his acceptance of the idea behind it. The Minister said, encouragingly, at the end of our discussion on amendment No.13 that perhaps a four month period might be acceptable to him and that we might, by agreement, arrange for the insertion of "four months" on Report Stage with the agreement of the Minister, the Opposition and the Chair.

This amendment is looking for transparency. It says "... and, in particular, profit and loss accounts for specific services to and from specific places which services attract Government subsidy". I want the suggested amendment taken in the context of a general agreement that the national transport company are involved in a nationwide social service — in the Twenty-six Counties anyway — which commands the support of the House at a cost of £115 million in the last year for which accounts are available. The reason behind this is that the House and the taxpayer should know exactly what they are supporting. In certain parts of the country where, for example, rail services have been terminated, there is often a sense of grievance — in some cases a legitimate one — that moneys are being paid to subsidise other areas to retain rail services. For all I know, the services to specific areas that have what on the surface looks like a legitimate cause for complaint may be commanding an equally high subsidy. I do not know and it is because of this large region of darkness that I put forward this amendment.

I take the point the Minister made that some people might use it for purposes of chicanery — I love that word — if the transparency applied to every line and that people would advocate the lowering of fares which would mean raising subsidies. Anything suggested in the accountancy area is capable of being twisted if people decide to advance arguments for or against certain courses of action. However, I rely on the common sense of the Houses of the Oireachtas and the taxpayers who, because they have more information, does not necessarily mean that they will pressurise a Government Minister, the chairman of CIE or the chairman or boards of the various companies to suspend a service. It would also give us some insight to other developments which might provide as good or an even better service without necessarily incurring extra expense. I am referring to the whole area of city services transport where people complain that large double decker buses at certain times of the day are travelling practically empty. In rural areas, which would be within the competence of the national bus company, large single decker buses are plying in places where smaller buses would suffice and be more economical to run. In other countries, as I mentioned already, smaller buses holding about 30 people are used for shuttle and link services to beaches and so on which means that capital and fuel costs are less. Admittedly, as the Minister said, salaries and wages are a very large proportion of the expenditure of CIE and a fully qualified driver would be needed even for a small bus. It is only by having transparency that this House — whatever about the management in CIE — can see where developments take place. I urge the Minister to accept my amendment.

I cannot accept this amendment because it is potentially dangerous. It would be wrong of the House to be involved in measuring the cost of individual services. The board should do this although they should not waste too much manpower and money in doing so. It would be much better to set a limit on the subsidy for each service, railways provincial and city bus services. We could base this on the subsidy per passenger or passenger mile. We can get details about passengers and passenger miles instead of weighing up every route and service in peak and off-peak times. This would not make sense although it has often been advocated by transport economists. However, I do not know of any administration which does this. I was in Toronto about a year and a half ago and I had discussions with members of the transport commission in that city. I asked them how their subsidy was worked out and they told me they had this idea of trying to assess the social dimension of a particular service. To what extent is the service to Naas social? To what extent is the service to Portlaoise social? To what extent is the service to Nenagh social? That is an area in which we can get into impossible difficulties. Is a Sunday night service from Nenagh to Dublin as social as a Monday night service or is a Friday night service from Dublin to Nenagh as social and liable to a subsidy as a Wednesday night service? The Canadians firmly rejected that proposition and rightly so. We would be getting into a great deal of bureaucracy.

Subsection (7) states that each company shall furnish the board for transmission to the Minister with such information, accounts, statistics and returns as the Minister may from time to time require. I understood from the Minister's statements earlier on that he receives accounts every six weeks or so of what is happening.

I receive management accounts every four weeks.

Maybe I am wrong to presume that CIE as they stand — probably more so when the company are broken up — will be able to break down areas of profit and loss and will be able to give some information as regards the social content of certain services. They must have been able to do so in the past because they were able to cut off many services. I agree with Deputy Wilson that for specific services information should be available to the Minister. I am not declaring that every detail of CIE business or any of the companies' business should be made public. Giving full information in a business content is not always the best for a business but, where decisions have to be made and where wrong criticism is being made, information to justify what is being done should be made available if possible. It should be striven for and if it is necessary for it to be produced let it be made available. The Minister should consider this amendment in order to have the necessary information available within the company.

Is the amendment being pressed?

I would like to make a comment on the Minister's contribution. I know McKinsey recommended above the line payments to CIE. I agreed with that suggestion. The Minister has put that recommendation into effect. We now have an above the line contribution to CIE. All round it was a beneficial development as far as CIE are concerned. The Minister emphasised how important morale is and how important it is for the management and the work-force to be of the opinion they are taking part in a worth-while business exercise, that they are being paid by this House for part of that service and that the customers are paying for the other part.

The £115 million which was provided in the past year is a payment for a social service to the community. One could say in a lumpen kind of way that the £115 million worth of the service is social. What I am trying to do is to give this House a look at how that £115 million is made up, not with the intention of closing services but with the intention of making clear to the piper or to the people who call the tune and pay the piper what they are paying for. It is for that reason I am pressing the amendment. It has nothing to do with withdrawing services because they cost too much. I take it that in the global area we have decided to pay £115 million in 1985 and that that payment has the backing of the House. What I want to know is how that £115 million is divided up. I do not accept that a better way for doing it would be to put a limit on the subsidy per service and I do not think that is an ideal way for handling it at all. The subsidy per passenger or passenger mile which is from one realm of commercial viability or non-viability is being transferred to the social area. Thinly populated areas are going to lose out on that criteria.

When the Minister asked the question as to how far we can reckon a service to Naas as social I would say the answer is precisely the difference between what CIE make in running their service to Naas and what it takes to run that service. The Naas service may very well pay for itself and the accounts may show that. It may very well make a little profit but for the information of the House we should know that. How does the rail service from Dublin to Rosslare fare out? That service is linked to another area of our national life, specifically it is linked to tourism. The Rosslare harbour authority and the people in Wexford take a deep interest in that service and the service which goes from east to west from Rosslare. It could be argued that, for the benefit of tourism, it cannot be taken that if the service from Rosslare to Munster loses money, that is in effect losing money for the nation. That need not necessarily be so if it is supplying a tourist need.

What I have in my amendment is a push towards something the Minister agrees with, that is, that we know exactly what the £115 million is devoted to. I urge the Minister to accept this as it will help in the area in which he is concentrating, namely, to make it as clear as possible where moneys voted in this House are going.

I do not believe there is any sense in repeating what I have already said. We have already put a limit on the expenditure on each of the main services provided by CIE and we have set targets for reducing each of them over the next five years. Over the past four years these targets have been met each year, or bettered. The £115 million to which the Deputy referred is broken down as follows, and I gave these details in my Second Stage speech: railways, other than DART £75.6 million; DART £7 million, other than the £16 million interest; Dublin bus services £16.8 million: provincial city bus services, £2.1 million: other provincial bus services £0.3 million: canals £1.4 million; and the Galway/Aran ferry service £0.8 million. I urge Deputy Wilson not to press his amendment because it would lead to a great deal of bureaucracy which would not meet any particular objective. It would be much better to have an overall limit and to let the board decide on the services to be provided.

I would accept what the Minister said if I believed it would mean an excess of bureaucracy but it could only mean an excess of bureaucracy if all we had invested in the computer science field in third level education over the last number of years has been a total failure. I believe we have qualified people who could be employed, and not great numbers of them, by CIE who would be able to make this kind of information available with the minimum expense from the manpower point of view and with the maximum benefit to legislators and to administrators in the Department and to give information to the taxpayers.

Let us look at the figures the Minister gave now, on the Second Stage and in reply to my parliamentary question not too long ago. For example, it must be discouraging to the Dublin city services sector, a very busy sector, when they are told they have to be subsidised to the tune of £16.8 million when it is well known that there are services within that service which are profitable. All I am seeking in this amendment is further clarification of the area that is profitable and that that should be shown in the normal accounts of CIE. It was on that basis that I appealed for a shorter delay in the presentation of accounts and in this instance that I have appealed for more detailed reporting to the board, to the Minister, to this House, and through this House to the taxpayer.

Amendment put.
The Committee divided: Tá, 66; Níl, 76.

  • Ahern, Michael.
  • Andrews, David.
  • Andrews, Niall.
  • Aylward, Liam.
  • Barrett, Michael.
  • Brady, Gerard.
  • Brady, Vincent.
  • Brennan, Mattie.
  • Brennan, Paudge.
  • Briscoe, Ben.
  • Browne, John.
  • Burke, Raphael P.
  • Byrne, Hugh.
  • Byrne, Seán.
  • Calleary, Seán.
  • Collins, Gerard.
  • Conaghan, Hugh.
  • Connolly, Ger.
  • Cowen, Brian.
  • Daly, Brendan.
  • Doherty, Seán.
  • Fahey, Francis.
  • Fahey, Jackie.
  • Faulkner, Pádraig.
  • Fitzgerald, Gene.
  • Fitzgerald, Liam Joseph.
  • Fitzsimons, Jim.
  • Flynn, Pádraig.
  • Foley, Denis.
  • Gallagher, Denis.
  • Gallagher, Pat Cope.
  • Geoghegan-Quinn, Máire.
  • Hilliard, Colm.
  • Hyland, Liam.
  • Kirk, Séamus.
  • Kitt, Michael.
  • Lemass, Eileen.
  • Leonard, Jimmy.
  • Leonard, Tom.
  • Leyden, Terry.
  • Lyons, Denis.
  • McCarthy, Seán.
  • McCreevy, Charlie.
  • McEllistrim, Tom.
  • MacSharry, Ray.
  • Molloy, Robert.
  • Moynihan, Donal.
  • Nolan, M.J.
  • Noonan, Michael J. (Limerick West)
  • O'Connell, John.
  • O'Dea, William.
  • O'Keeffe, Edward.
  • O'Hanlon, Rory.
  • O'Kennedy, Michael.
  • O'Leary, John.
  • Ormonde, Donal.
  • O'Rourke, Mary.
  • Power, Paddy.
  • Reynolds, Albert.
  • Treacy, Noel.
  • Tunney, Jim.
  • Wallace, Dan.
  • Walsh, Joe.
  • Walsh, Seán.
  • Wilson, John P.
  • Woods, Michael.

Níl

  • Allen, Bernard.
  • Barnes, Monica.
  • Barrett, Seán.
  • Barry, Myra.
  • Barry, Peter.
  • Begley, Michael.
  • Bell, Michael.
  • Boland, John.
  • Bruton, John.
  • Bruton, Richard.
  • Burke, Liam.
  • Carey, Donal.
  • Cluskey, Frank.
  • Collins, Edward.
  • Conlon, John F.
  • Connaughton, Paul.
  • Coogan, Fintan.
  • Cooney, Patrick Mark.
  • Cosgrave, Liam T.
  • Cosgrave, Michael Joe.
  • Coveney, Hugh.
  • Creed, Donal.
  • Crotty, Kieran.
  • D'Arcy, Michael.
  • Deasy, Martin Austin.
  • Desmond, Barry.
  • Desmond, Eileen.
  • Donnellan, John.
  • Dowling, Dick.
  • Doyle, Avril.
  • Doyle, Joe.
  • Dukes, Alan.
  • Durkan, Bernard J.
  • Enright, Thomas W.
  • Farrelly, John V.
  • Fennell, Nuala.
  • FitzGerald, Garret.
  • Flaherty, Mary.
  • Glenn, Alice.
  • Griffin, Brendan.
  • Harte, Patrick D.
  • Hegarty, Paddy.
  • Hussey, Gemma.
  • Kavanagh, Liam.
  • Kelly, John.
  • Kenny, Enda.
  • L'Estrange, Gerry.
  • McCartin, Joe.
  • McGahon, Brendan.
  • McGinley, Dinny.
  • McLoughlin, Frank.
  • Manning, Maurice.
  • Mitchell, Gay.
  • Mitchell, Jim.
  • Molony, David.
  • Moynihan, Michael.
  • Naughten, Liam.
  • Nealon, Ted.
  • Noonan, Michael. (Limerick East)
  • O'Brien, Fergus.
  • O'Brien, Willie.
  • O'Donnell, Tom.
  • O'Leary, Michael.
  • O'Sullivan, Toddy.
  • Owen, Nora.
  • Pattison, Séamus.
  • Prendergast, Frank.
  • Ryan, John.
  • Shatter, Alan.
  • Sheehan, Patrick Joseph.
  • Skelly, Liam.
  • Spring, Dick.
  • Taylor, Mervyn.
  • Taylor-Quinn, Madeline.
  • Timmins, Godfrey.
  • Yates, Ivan.
Tellers: Tá, Deputies V. Brady and Browne; Níl, Deputies F. O'Brien and Taylor.
Amendment declared lost.
Question proposed: "That section 19 stand part of the Bill."

The objective of the two amendments that have just been lost was to have more transparent culpability for funds. I am sorry they were defeated. However, I welcome the Minister's approach to them. Perhaps he will indicate to me later, not necessarily in the House, whether he might accept on Report Stage a stipulation for four months instead of three months for the provision of the annual accounts.

Question put and agreed to.
SECTION 20.
Question proposed: "That section 20 stand part of the Bill."

This is a routine section.

At present the board have power to borrow and have been borrowing to make up the difference between the subsidy and the deficit over the years. Is this section designed to continue that kind of operation?

Yes, among other things. The section provides for any temporary shortages of funds. Up to a few years ago CIE had short term borrowings of £36 million. The Government have taken on board £30 million of that. There were shortfalls in the subvention in preceding years. The company took on responsibility for £6 million. The £30 million will be written off over ten years. There has been a very significant improvement in the board's temporary borrowing position.

So far as I remember, the board still have to pay the interest. The Government just pay £3 million a year.

The subsidiary companies may also borrow according to the provision in section 20. Is that right?

Yes, with the permission of the board.

In other words, the board will set the limit?

The statute will set the limit for the parent board and the board will set the limit for the subsidiary companies?

Question put and agreed to.
SECTION 21.
Question proposed: "That section 21 stand part of the Bill."

This is a disclosure section which is taken directly from the Postal and Telecommunications Services Act, 1983.

I am in full support of section 21.

Question put and agreed to.
SECTION 22.
Question proposed: "That section 22 stand part of the Bill."

Similarly, this is a section which is taken directly from the Postal and Telecommunications Services Act, 1983.

I did not hear the Minister.

This is a replica of a section in the Postal and Telecommunications Services Bill, 1982, regarding the unauthorised leaking or publishing of confidential information of the board.

I agree with that but I do not know what effect the £1,000 fine is supposed to have. A good deal of revenue could be collected if this was extended to the practice of leaking in other domains.

Question put and agreed to.
SECTION 23.
Question proposed: "That section 23 stand part of the Bill."

The then Minister for Industry and Commerce, Deputy Bruton, abolished the National Prices Commission. So far as I remember that commission used to examine fares and so on. The Government had a final veto on fares and that has been maintained. Where the prices Acts do not apply what provision is there in the Bill? The Minister still retains the power to accept or reject, from individual companies and the parent board, suggestions for fares and tariffs. Is that correct?

What was the question?

Does the Minister still reserve the power to reject suggestions for increases in fares or tariffs?

Yes. The Government will still, as a matter of policy, retain the power to approve or disapprove fare increases. In the case of Dublin city services it will be a matter for the Dublin Transport Authority, subject to ministerial approval.

The fact that the Dublin Transport Authority will have that power pleases me. It would please me if they had a lot more power. Does the application filter through the parent board or do the individual companies have powers to submit to the Minister terms of increases in fares and tariffs?

It will be filtered through the parent board.

Question put and agreed to.
SECTION 24.
Question proposed: "That section 24 stand part of the Bill."

This is a routine section in Bills of this kind providing for the continuance of legal proceedings in the name of the companies rather than the board where appropriate.

I hope the Minister will bear in mind what I said already in regard to legal proceedings in which CIE are involved. If some of the conditions for smaller companies and smaller management areas are realised I hope it will also result in speeding up the legal process where individual citizens are concerned. I know that in a number of instances grave injustices were done by unnecessary legal delays involving citizens in litigation with CIE.

Question put and agreed to.
SECTION 25.
Question proposed: "That section 25 stand part of the Bill."

I attach considerable importance to this section. It substitutes for section 14 of the Transport Act, 1950, and extends the scope of it greatly. One of my pet interests for a long time has been to exploit and develop the assets of CIE to the advantage of the companies, the board and the taxpayer. There is great potential in this.

The House will recall that I mentioned the word "development" in my contribution on Second Stage of this Bill. I wish that word was present in far more documentation and legislation coming from the Government. Development has almost become a dirty word in our economy. There is no developmental outlook and for that reason I was glad to see that the Minister included the word "development" here.

I should like to mention a CIE works in which the Minister has a special interest, the works at Inchicore. There is a lot of expertise available there. In that context I should like to mention that Mr. Ciaran Kennedy, Director of the Economic and Social Research Institute, who some years ago carried out a survey of the economy in Denmark found that many of the new engineering companies there had been developed by people who had been employed in larger concerns. There is a great volume of expertise in the Inchicore works and the Minister, the chairman, who has a developmental mind, and the board should encourage the workers to use their skills and expertise. They should not be satisfied with the ordinary weekly wage, fighting for more and so on as has been the custom in the past. That must be done but those workers should concentrate their minds on development. There must be several useful subsidiary industries in the engineering field where the skills of those people could be deployed. We should encourage the workers to develop a spirit of enterprise among themselves. For those reasons I am glad this provision has been included.

I do not intend to delay the debate but I should like to mention that for the past few months the former bus building company at Shannon has been in operation, under the direction of CIE, completing the work on a number of vehicles that were not completed by the last concern. This excellent plant is in an ideal location and has a highly skilled workforce. I should like to impress upon the Minister the need to develop that plant. I appeal to him to keep the plant in operation now that CIE are finishing work on 25 buses that were on the production line when the former owners closed the factory. I should like to compliment CIE on the way they have tackled this. With the co-operation of the liquidator they managed to complete the buses which will prove a very valuable asset to the company.

I should like to draw the Minister's attention to the need for a bus building plant here. The attention of CIE should be directed to the potential of the Shannon operation. Many school buses and city and rural buses need to be replaced and the replacements can be produced at the Shannon plant. The work would provide badly needed jobs in the locality. If CIE take over the concern they will be buying a very valuable asset. If we do not build replacement buses at Shannon we will have to import them at a greater cost to the Exchequer. It is important that that plant is developed to build coaches for CIE. Last year we criticised the decision of the company to import coaches. They could have been manufactured at the Shannon plant. I hope the Minister takes a special interest in this matter to see if it will be possible to continue building buses in Shannon. That plant is capable of building school buses, city buses or coaches for tourists.

I should like to support Deputy Daly. His comments are in line with what I said about a developmental attitude in the works at Inchicore. I am aware that the school bus fleet has been badly depleted. There has not been any decision to abolish the service or continue it but there has not been any capital provision. It should be remembered that CIE own the machinery in what was formerly the GAC plant and, before that, the Bombardier company. We are not advocating the establishment of an industry that would not be viable in the ordinary commercial sense but the areas mentioned by Deputy Daly should at least command the attention of CIE. The company should consider building a smaller type of bus for use in off-peak hours in cities or as a link on heavily frequented routes. One can see a model for such a bus on the continent. These matters should be brought to the attention of the chairman and the board of CIE with a view to the company taking action in the future.

I note what the Deputies have said about this matter. I agree that the plant and rigs are in place and are owned by CIE. The possibility is always there for a resumption of bus-building at the Shannon plant. However, it would be wrong of us to give the impression that that could happen easily. It would not be sufficient to get orders for school buses or ongoing replenishment of the CIE fleet. That would not keep the plant in operation. For that plant to be successful it will be necessary to secure substantial export orders. Even if we had plenty of money at home to order the fleet replenishment that the company would like, the amount of work involved would not be enough to keep the plant going. Export orders are crucial. Since the plant was opened it has been impossible, despite the best efforts of Bombardier and GAC, to get export orders.

I accept that economics are very important but the Minister should investigate the possibility of building a small type of bus for the purposes I have suggested. When I was Minister I inaugurated the post bus service in County Clare but I do not think that was followed up. We should specialise in a special type of bus that could feed into the school bus service, to off peak services in the cities and feeder services. There would be a better chance of getting an export business going if there was a major market for such a vehicle at home. It should not be beyond the wit of accountants and assessors to put the whole picture of an operation such as this into a report taking the cost to the country of imports and the loss of PRSI and PAYE payments into account. Another factor that should be taken into account is the fact that if people are employed at the plant the number on unemployment benefit will be reduced. It should be possible for an actuary, or a highly qualified accountant to put the sum together and show us exactly how much extra it would pay the country to be building the buses while still making on the swings money it had lost on the roundabouts I mentioned.

I direct the Minister's attention to the desirability of having a modest bus building operation at Shannon. The skills are there and the plant, and it has been proved that buses can be produced there successfully and economically. This is a separate issue that could be taken into account later. There is a need for such an operation in the area not only from the point of view of employment but of the economics involved. I am talking about a small operation, the production of two buses per week, 100 per year. It would make economic sense and it would be realistic rather than closing the plant and have CIE importing buses in the near future, which would be a major mistake. I emphasise I am not calling for an elaborate operation through which the product could be exported; I am asking that the plant be kept open to produce CIE's needs in regard to school, rural and city buses and coaches. They are being imported at the moment.

One of the problems is that in any plant like this the overheads are steep and the smaller the number of units produced the greater the cost per unit. If you produce two buses a week, 100 per year, the unit cost would be far greater than if you were producing 1,000 buses a year. It would not be economic to talk in these terms. It would give me great pleasure to reopen that plant——

It is open.

They are finishing off buses which had been begun before liquidation. It would be wrong of us to create unjustified expectations about reopening the plant, raising the hopes of people in the area who are desperate. We should give hope only when it is justified — we should be reasonably sure of securing and being able to fill export orders. Our home market would not sustain such an undertaking.

It would be equally short-sighted of CIE and the Government to close the plant, wind it up and abandon it and in a few weeks to import buses.

I would encourage an actuarial exercise in regard to that plant, taking everything I said into consideration.

Question put and agreed to.
SECTION 26.
Question proposed: "That section 26 stand part of the Bill."

It is right that the Government and the Oireachtas retain policy direction but I believe that such policy direction should be given by the Minister by order and the direction should be given in writing when requested by the board so that the House will know when the Minister has given a policy direction about which the board are not happy.

I am in an ambivalent mood about this. The Minister berated various Governments for interfering in the affairs of CIE in the past. A definition of policy direction could be argued to include anything to do with the running of CIE. The next section gives the Minister considerable powers. Subsection (1) of this section states:

The Minister may give to the Board such directions in writing as to policy in relation to the functions of the Board, the companies, or any of them, as he thinks proper.

I take it that the directions will be given to the board rather than to the individual companies, or does it mean that the Minister can give directions to the companies through the board? I will not be opposing the section though the powers are pretty extensive. A section giving such powers to the Minister and the administration requires careful scrutiny and attention, with possible modifications by the Opposition.

Question put and agreed to.
SECTION 27.
Question proposed: "That section 27 stand part of the Bill."

This is a routine provision in regard to the compulsory acquisition of land by the board.

If the Minister were to extend the rapid rail system to Tallaght, as he promised, the board would need compulsory powers to acquire land. A good deal of land was acquired by CIE from Dublin to Tallaght. If it is to be used for the purpose of extending the rail link to Tallaght we should support it. I would point out that CIE sold off little parcels of land along the Harcourt Street line. If there is to be a road or a rail development in that direction, the company would have to proceed to acquire land, and there would be considerable opposition from people who paid considerable sums of money for land on that route to extend their back gardens. I know some of the people who did that.

Question put and agreed to.
SECTION 28.
Question proposed: "That section 28 stand part of the Bill."

This merely extends the by-laws conferred by the 1950 Act to the board for the purpose of the exercise by the companies of their functions.

Will the companies themselves have the power to make by-laws or will that still rest only with the board?

Question put and agreed to.
SECTION 29.
Question proposed: "That section 29 stand part of the Bill."

This section relates to temporary borrowing by the board, including borrowing in a currency other than that of the State.

The Bill states that the companies may make temporary borrowings with the permission of the board.

The provision applies only to the board, but they will have overall control of group borrowing.

Will the board of the Dublin city services be empowered to go to Germany, for instance, to borrow Deutsche Marks?

The company would, with the permission of the board.

Question put and agreed to.
SECTION 30.
Question proposed: "That section 30 stand part of the Bill."

Under this section an amended wording has been substituted for section 35 (1) of the Act of 1950 which relates to the appointment of staff by the board. The purpose of this section is to remove, in the interests of flexibility, the statutory obligation on the board of CIE to appoint a secretary and a general manager. This flexibility is particularly desirable in the current situation where the chairman holds office on a full time basis and where the organisation is undergoing a period of change and restructuring involving the movement of some of the duties of the general manager to the subsidiary companies.

Section 35 of the Act of 1950 is amended by substitution of the following subsection for subsection (1):

The board shall appoint such officers and servants as the board may determine and their remuneration shall be paid by the board out of funds at its disposal.

That is in substitution for a subsection of the 1950 Act. How does the fact that the chairman is now full time impact on the fact that there is still a general manager?

The chairman was in the past mostly a part time non-executive chairman. With the companies in place there will be an executive chairman plus the chief executives of each of the three companies so, to provide and insist that there has to be a secretary of the board and a general manager of the board seems a bit unnecessary and inflexible. That is not to say that the board may not wish to make those appointments. It possibly will in the beginning.

This section enables them to get out of the statutory obligation to appoint certain people and then they have more freedom to select their officers themselves.

Question put and agreed to.
SECTION 31.
Question proposed: "That section 31 stand part of the Bill."

This is a fairly routine section and is to exempt from stamp duty the vesting of any property or rights transferred by this Act.

I wish I had a whole half day to oppose this. Quite regularly people come to my political clinics showing me large demands from the Revenue Commissioners for stamp duty. People may get a few acres of land from an uncle or an aunt and they cannot understand how the valuation office values it at one and a half times what the local auctioneer can get for it if they want to sell it. Therefore when it is a State company I do not think it should get away with this. I am not opposing it but one would not know what I will do on Report Stage.

Question put and agreed to.
TITLE.
Amendment No. 15 not moved.
Question proposed: "That the Title be the Title to the Bill."

Unfortunately the word "three" is retained. That was the decision of the House and I accept it. We were defeated in our attempts to substitute "two" for "three".

If the new structures and the new management-chairman and chief executive type structure develops this company in the various ways that have been suggested in the course of this debate then our work here will have been worthwhile.

Tá súil agam go n-éireoidh le Córas Iompair Éireann sa todhchaí. Tá a fhios agam go raibh daoine ag díspeagadh Córas Iompair Éireann i rith na mblianta. Tá a fhios agam go bhfuilimid ag brath air mar chóras náisiúnta sa tír. Táimidne ar aon chaoi dóchasach, mar go bhfuil a fhios againn fiúntas na ndaoine atá ag obair sa chomhlacht, Córas Iompair Éireann. Is fiú morán iad agus más rud é go bhfuil an bhainistíocht i gceart, go bhfuil an cheannasaíocht i gceart, éireoidh leis. Tá súil agam nach mbeidh tréimhse amháin ann go dtí go mbeidh an comhlacht i mBaile Átha Cliath ag déanamh brabúis don chomhlacht iomlán ionas go mbeimid ábalta seirbhísí sóisialta a chur ar aghaidh de réir meon na ndaoine a labhair ar an mBille sa Teach ar an ócáid seo.

Question put and agreed to.
Bill reported without amendment.

Can the Minister give us a date for the Report Stage?

I suggest next Tuesday, subject to the agreement of the Whips.

I am very grateful to Deputy Wilson and the other Deputies for taking part in the debate on Committee Stage and for their very constructive comments and suggestions. I much appreciate them. I would like in particular to echo what Deputy Wilson has just said. He spoke a great deal of wisdom. I very much hope that the work we have done here will set the stage for a resurgence of CIE in the future. A great deal has already been achieved in the past four years. There has not been a time for many years when there was occasion to have more confidence in CIE than we have now. I believe this Bill will boost that confidence and will serve not only CIE but the nation as well.

Report Stage ordered for Tuesday, 2 December 1986.